Rental vacancies rise as home buying improves
Rental vacancies rise as home buying improves
Posted on Wednesday, July 17 2013 at 12:41 PM
Figures released this week indicate residential property vacancies have increased in most capital cities throughout June, and new homebuyers are a factor.
SQM Research says the overall
vacancy rate rose by 0.1 per cent to 2.2 per cent nationally.
Melbourne has recorded the
highest vacancy rate of all the capital cities at 2.9 per cent.
Darwin has recorded the
tightest figure at 0.8 per cent and was the only capital city to see its rate
drop.
Louis Christopher, managing
director at SQM Research, says the figures are part of a trend showing a
gradual upswing in vacancy rates around Australia.
“As
stated with May’s result, it has become apparent that vacancy rates are now
rising.
Christopher
says the reasons are diverse, although improved first homebuyer activity could
be a factor.
“Causations
behind the rise vary from city to city. For example, the rises in Melbourne and
Canberra are as a direct result of rises in completions of new residential
dwellings throughout 2012 and early 2013. The rises in Perth appear to be more
demand related.
“While the general comment
has been the number of first homebuyers are at a record low as a proportion of
the overall market, the truth is that over the past five months, first homebuyers
have basically been increasing in the market and there are now more first homebuyers
in the market.
“First homebuyer activity
has picked up from a very low base and we expect it to further pick up. So,
yes, there have been renters turning themselves into first homebuyers over the
last three months.”
Christopher
cautions investors to factor the flatter rental market into their portfolio
decisions.
“This national housing
recovery that we’ve had has been largely driven by investors and I think many
of them have been jumping in with the view that they will get rental increases.
“A number of them are going to be disappointed as
to how much (rental) bargaining power they are going to have in the
marketplace.”
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